why not to trade a $100 stock

I'm in this stock class and they say never to trade a > $100 stock here's why:

Example 120.20 (bid) 120.35(ask)
say you are first in line with a buy limit 120.20. A sell market order comes. What they say is that if the specialist knows that the price will go up, he'll bid 121.21 and get his order filled. Or if the specialist knows the price will go down he'll let you get filled. So you only get filled when you don't what to. Is that true?

Also if so, they why couldn't this happen in a stock with a spread > .01 like 23.02 (bid) 23.04(ask), if you bid .02 the specialist could penny you @ .03?

A lot of slippage, and a number of automated programs similar to the old "SOES Bandits" that find wide spreads and place "hidden" buys and sells between the NBBO quotes. There are also hidden liquidity pools that may be priced in between as well.